IN THE UNITED STATES DISTRICT COURT 

FOR THE SOUTHERN DISTRICT OF OHIO 

EASTERN DIVISION 

DAVID E. CAMERON, et al., : 

 : Case No. 2:12-CV-00168 

 Plaintiffs, : 

 v. : JUDGE ALGENON L. MARBLEY 

 : 

HESS CORPORATION, et al., : Magistrate Judge Deavers 

 : 

Defendants. : 

OPINION & ORDER 

 This matter is before the Court on the Motion of Defendants Hess Corporation, Hess 

Ohio Resources, LLC, and Hess Ohio Developments, LLC (collectively “Defendants” or “Hess”) 

to Reconsider, in Part, Opinion and Order on Summary Judgment Motions. (Doc. 68.) 

Specifically, Defendants move that this Court reconsider and grant Defendant relief from the 

portion of this Court’s September 24, 2013 Opinion and Order, (Doc. 66), granting summary 

judgment to Plaintiffs Melissa and Stephan Griffith. For the reasons set forth herein, Defendants’ 

Motion is DENIED. 

II. BACKGROUND 

The facts and procedural history of this matter are set forth at length in this Court’s 

Opinion and Order dated September 24, 2013 (the “Opinion and Order”). (Doc. 66.) In the 

Opinion and Order, the Court ruled in favor of Plaintiffs Melissa and Stephen Griffith 

(collectively “Plaintiffs” or the “Griffiths”) on their motion for summary judgment on their lease 

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termination claim against Hess.1

 (Id. at 15.) 

Specifically, the Court considered whether an oil and gas lease executed between Hess’s 

predecessor-in-interest, Mason Dixon, (the “Griffiths Lease”) remained valid and enforceable or 

had terminated on its own terms. (Id. at 10.) In deciding this question, the Court considered two 

relevant provisions of the Griffiths Lease: (1) the habendum clause, and (2) the “delay rental” 

provision. The habendum clause provided that the Griffiths Lease had a “primary term” of five 

years, and authorized the Lessee (i.e., Hess) to extend the lease term for an “additional term” of 

five years through tendering to the Lessor (i.e., the Griffiths) an “extension payment.” Griffiths 

Lease ¶ 2. The “delay rental” provision provided that, if drilling was not commenced within 12 

months, the Griffiths Lease would automatically terminate unless the Lessee tendered a “delay 

rental” payment, which would preserve the right to drill for an additional 12 months. Id. at ¶ 4. 

The “delay rental” provision also stated that, “[t]hereafter, annually, in like manner and upon like 

[delay rental] payments or tenders, the commencement of drilling operations may be further 

deferred for periods of twelve (12) months each during the primary term.” Id. 

The Court assumed for the purpose of deciding the motions for summary judgment that 

the Griffiths Lease was validly executed and that the Lessee had made all payments – including 

“delay rental” and extension payments – required under the lease. After examining both relevant 

lease provisions, the Court determined that, because the language authorizing annual “delay 

rental” payments referenced only the “primary term” of the lease and not the “additional term” 

created through an extension payment, Hess was not permitted to defer drilling operations during 

 

1 The Court also denied summary judgment to co-plaintiff David Cameron on his lease termination claim against 

Hess, based on differences in the language and terms of the two Leases. That ruling, however, is not at issue in 

Defendants’ Motion for Reconsideration.

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the “additional term.” (Doc. 66 at 11-12.) As the Court explained: 

Ohio courts have regularly encountered habendum clauses in oil and gas leases 

that provide for primary and secondary terms, and recognized that terms of the 

contract may impose distinct obligations for each. See, e.g., Am. Energy Sev. V. 

Lekan, 598 N.E.2d 1315, 1319-20 (Ohio Ct. App. 1992) (interpreting a habendum 

clause to mean that “[i]f after the expiration of the primary term the conditions of 

the secondary term are not continuing to be met, the lease terminates by the 

express terms of the contract herein and by operation of law and revests the leased 

estate in the lessor”) (emphasis added); Moore v. Adams, No. 2007-AP-90066, 

2008 WL 4907590, ¶¶ 26-28 (Ohio Ct. App. Nov. 17, 2008) (noting that an oil 

and gas habendum clause has two parts – a primary term and a secondary term – 

that impose distinct conditions). As such, where the language of a habendum 

clause creates two distinct terms – here, a “primary term” and an “additional 

term” created by an extension payment – this Court cannot infer that conditions 

that expressly apply to the “primary term” also automatically apply to the 

“additional term.” Had the parties intended this result, they could have so 

contracted. 

(Id. at 12.) 

Based on the above, the Court concluded that the Griffiths Lease did not authorize Hess 

to use annual delay payments to postpone drilling during the additional term. Thus, even though 

Hess made the requisite payment to extend the lease term for an additional five years, the 

Griffiths Lease automatically terminated on June 13, 2012, pursuant to the “delay rental” 

provision, when Hess failed to commence drilling during the first 12 months of the additional 

term. Having so determined, the Court granted summary judgment for Plaintiffs as to the 

termination of the Griffiths Lease. 

In their Motion for Reconsideration, Defendants argue that an error in the Court’s 

transcription of the habendum clause – taken from Defendants’ own briefing – substantively 

alters the conclusion above. In particular, Defendants point out that Page 3 of the Opinion and 

Order inaccurately quotes Paragraph 2 of the Griffith Lease as stating, in pertinent part, that: 

Lessee has the option to extend this lease for an additional term of five (5) year(s) 

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from the expiration of the primary term of this lease, and as long thereafter as oil 

or gas . . . or either of them, is produced from said land by the Lessee, its 

successors and assigns, said extension to be under the same term of this lease. 

(Doc. 66 at 3) (emphasis supplied). 

Paragraph 2 of the Griffith Lease actually states: 

Lessee has the option to extend this lease for an additional term of five (5) year(s) 

from the expiration of the primary term of this lease, and as long thereafter as oil 

or gas . . . or either of them, is produced from said land by the Lessee, its 

successors and assigns, said extension to be under the same terms and conditions

as contained in this lease. 

Griffiths Lease ¶ 2 (emphasis supplied). 

Relying on the language originally omitted from the Opinion and Order, Defendants 

argue that the Lessee did contract for the “delay rental” provision to apply to the additional term 

of the lease. Defendants therefore argue that there exists a clear mistake of fact that warrants 

reconsideration of this Court’s Opinion and Order granting summary judgment for the Griffiths. 

III. STANDARD OF REVIEW 

 District courts will reconsider a prior decision “if the moving party demonstrates: (1) a 

clear error of law; (2) newly discovered evidence that was not previously available to the parties; 

or (3) an intervening change in controlling law.” Owner-Operator Indep. Drivers Ass’n, Inc. v. 

Arctic Express, Inc., 288 F. Supp. 2d 895, 900 (S.D. Ohio 2003). See also Gen. Corp., Inc. v. 

Am. Int’l Underwriters, 178 F.3d 804, 834 (6th Cir. 1999) (a judgment may also be altered or 

amended when necessary “to prevent manifest injustice”). 

As this Court has recognized, “[d]istrict courts ‘have authority both under common law 

and [Federal] Rule [of Civil Procedure] 54(b) to reconsider interlocutory orders and to reopen 

any part of a case before entry of final judgment.’” Gibney v. State Farm Fire & Cas. Co., No. 

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2:10-CV-00708, 2012 WL 6015961, at * 3 (S.D. Ohio Dec. 3, 2012) (quoting 

Rodriguez v. Tenn. Laborers Health & Welfare Fund, 89 Fed. App’x 949, 959 (6th Cir. 2004) 

(citing Mallory v. Eyrich, 922 F.2d 1273, 1282 (6th Cir. 1991)). This authority “vests in district 

courts ‘significant discretion,’ . . . ‘to afford such relief from [interlocutory orders] as justice 

requires.’” Id. (quoting Rodriguez, 89 Fed App’x at 959). In particular, “[t]raditional 

justifications for reconsidering interlocutory orders include: ‘(1) an intervening change of 

controlling law; (2) new evidence available; or (3) a need to correct a clear error or prevent 

manifest injustice.’” Id. (quoting Louisville/Jefferson Co. Metro Gov’t v. Hotels.com L.P., 590 

F.3d 381, 389 (6th Cir. 2009)). Significantly, “justice does not require that the district court 

[grant reconsideration] on an issue that would not alter the district court’s prior decision.” 

Rodriguez, 89 Fed. App’x at 959-60. 

IV. LAW AND ANALYSIS

Here, Defendants argue that this Court made a substantive mistake of fact as to the 

language of the habendum clause of the Griffiths Lease and that, therefore, reconsideration of the 

Court’s Opinion and Order is warranted to prevent manifest injustice. Defendants misread the 

Opinion and Order. 

In determining that the Griffiths Lease did not permit “delay rental” payments during the 

“additional term,” the Court relied on express language in the “delay rental” provision that 

authorized the deferral of drilling operations “for periods of twelve (12) months each during the 

primary term.” Griffiths Lease ¶ 4 (emphasis supplied). As the Court explained in the Opinion 

and Order, in granting the Lessee “the option to extend this lease for an additional term of five 

(5) years(s) from the expiration of the primary term of this lease,” the Griffiths Lease “define[d] 

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the ‘additional term’ relative to, and as distinct from, the ‘primary term.’” (Doc. 66 at 11-12) 

(emphasis in Opinion and Order). That the “extension [is] to be under the same terms and 

conditions as contained in this lease,” Griffith Lease ¶ 2, does not change the fact that the 

“primary term” and “additional term” are two distinct terms. 

In specifying that drilling deferral is permitted in the “primary term” of the lease, the 

“delay rental” provision created an exception to the general rule that the same terms and 

conditions apply to both the “primary term” and “additional term.” Under the ordinary rules of 

contract construction, a more specific provision prevails over one that is general in its terms. See

Mut. Life Ins. Co. v. Hill, 193 U.S. 551, 558 (1904) (“[W]hen the parties express themselves in 

reference to a particular matter, the attention is directed to that, and it must be assumed that it 

expresses their intent; whereas a reference to some general matter, within which the particular 

may be included, does not necessarily indicate that the parties had the particular matter in 

thought.”). Thus, here, the “delay rental” provision controls the question of when delay rental 

payments are permitted under the lease. See Kelly v. Med. Life Ins. Co., 509 N.E.2d 411, 411 

(Ohio 1987) (“The intent of the parties to a contract is presumed to reside in the language they 

chose to employ in the agreement.”); see also Opinion and Order, Doc. 66 at 12 (“Ohio courts 

have regularly encountered habendum clauses in oil and gas leases that provide for primary and 

secondary terms, and recognized that terms of the contract may impose distinct obligations for 

each.”) (citing Am. Energy Sev. V. Lekan, 598 N.E.2d 1315, 1319-20 (Ohio Ct. App. 1992); 

Moore v. Adams, No. 2007-AP-90066, 2008 WL 4907590, ¶¶ 26-28 (Ohio Ct. App. Nov. 17, 

2008)). 

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Based on the above, correcting the transcription of the habendum clause to add the words 

“and conditions as contained in” does not change the proper construction of “delay rental” 

provision. The transcription error therefore has no bearing on the Court’s conclusion that 

drilling deferral payments are not permitted during the “additional term” of the Griffiths Lease. 

In light of the unambiguous language of the “delay rental” provision, the Griffiths Lease 

terminated on June 13, 2012, when Hess failed to commence drilling during the first 12 months 

of the “additional term.”2

 Because “justice does not require that the district court [grant 

reconsideration] on an issue that would not alter the district court’s prior decision,” Rodriguez, 

89 Fed. App’x at 959-60, Defendants’ Motion is DENIED. 

V. CONCLUSION

 For the reasons set forth above, Defendant’s Motion to Reconsider is hereby DENIED. 

IT IS SO ORDERED. 

 s/ Algenon L. Marbley 

 ALGENON L. MARBLEY 

 UNITED STATES DISTRICT JUDGE 

 

DATED: October 15, 2013 

 

2 Defendants also argue that, if the “delay rental” provision only allows deferral payments during the primary term, 

the portion of the “delay rental” provision that terminates the lease (i.e., if drilling is not commenced within 12 

months) also applies only to the primary term. This Court’s Opinion and Order held that annualized deferral 

payments were not permitted during the additional term, not that the entire “delay rental” provision did not apply to 

the additional term. Nor does the language of the “delay rental” provision support Defendants’ preferred reading of 

the contract. As Defendants themselves point out, the general rule of the Griffiths Lease is that the “extension [is] to 

be under the same terms and conditions as contained in this lease.” Griffith Lease ¶ 2. The “delay rental” 

provision’s sole reference to the “primary term” arises in connection with the authorization of annualized “delay 

rental” payments. Id. at ¶ 4. Because the text of the “delay rental” provision does not specify that termination upon 

failure to drill is limited to the primary term, the general rule dictates that the termination clause applies both to the 

primary and additional terms.

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